Professional Documents
Culture Documents
losses for 1 year & which , in the judgment of the bank , is likely
to incur losses for the current year as well as the following year, &
which has imbalances in its financial structure, like worsening
debt equity ratio.
V Magnitude of sickness
|
d r 1980 22269 21,828 2,21,097
d r 1998 2476 2,21,536 2,24,012
d r 1999 2792 3,06,221 3,09,013
d r2000 3164 3,04,235 3,07,399
d r2001 3317 2,49,630 2,52,947
The tot b nk credit ocked up in sick units incre se form Rs 13134 crore s the
end of d r 1993 to Rs 13748 s on m r 1996.
? Yndustry sickness is a social problem as its like a
burden on the society.
? Yndustrial sickness policy 1978,
? The govt. should make suitable arrangements for
monitoring & detecting industrial sickness at an
early stage
? Financial institutes that have substantial stake in
the co. could nominate their employee on the BoD
of the co.s with doubtful management
competency. Yn case if it finds co is indulging in
malpractices , it can restrict its financial
assistance.
? The govt shoud set up a screening committee to
make recommendation relating to sick
undertaking on the following lines
? A. in case the govt. finds that a unit can not be
handed back to the same management , it may
recommend a take over to the management
INTRNAL CAUSS
V 3
the net worth is 100% and more & the
unit continues to show cash losses for the next 2 years , the
management of the unit is required to report to the newly
constituted Board under the Act, which would then take
appropriate action which may involve merging, rehabilitating, or
even winding up after a fresh appraisal through an operating
agency
V Commercial banks grants various concessions to the
sick units like additional working capital, recovery of
interest rates are reduced,